That End-Of-Empire Feeling

By David Corn

Is the US in the last throes of empire? That sounds like an
ideologically loaded, fatalistic and defeatist question. But it's
what I've been wondering about this holiday season.

Might future historians look back at the Bush II days and ask if
this was the point when the country started slipping? Might the war
in Iraq be regarded as a desperate act of a superpower that had
already peaked? Will economists of the latter 21st century examine
our economic decisions and say, "What were they thinking?" Or has the
Grinch gotten to me?

Treasury Secretary John Snow says 'tis the season to be merry
because the malls are crowded and the American economy, under the
watchful gaze of George W. Bush, is on the move. But perhaps a touch
of foreboding is merited.

The White House and its conservative pals, trying to take
advantage of the cheery season, have recently started a new campaign
that claims Bush has been denied the credit for an economy that is
expanding at a decent clip and that produced 215,000 jobs in
November.

In fact, polls show that most Americans -- whether they're happy
in the malls or not -- have a downbeat view of the economy. And there
are solid reasons why Americans should not put aside concerns about
the country's long-term economic prospects and why Bush should not be
pronounced the savior of the American economy.

First, the correlation between presidential action (especially tax
cuts) and economic performance is iffy. How many conservatives
credited Bill Clinton, who raised taxes on the wealthy and balanced
the budget, for the explosive economic boom that occurred in the
1990s?

By contrast, the results -- and costs -- of a military invasion
are easier to tie directly to a commander in chief than economic
developments. If most of the public believes Bush deliberately misled
the nation into a bad war -- which is what most do think at the
present time -- then Americans can be excused for not hailing Bush
for the uptick in economic numbers for which he might or might not
bear responsibility.

Perhaps Americans also know -- or feel -- that wage growth has
lagged behind GDP growth. Or that the growing economy is a hot-money
economy fueled by reckless borrowing (which could be read as a sign
of national fading glory). Nervous Nellies like Alan Greenspan warn
that, despite the recent economic growth, Bush is driving the federal
budget off a cliff by creating trillions of dollars of debt that will
have to be paid off after he leaves office.

The current fiscal policy and the ballooning federal deficits,
Greenspan claims, are "unsustainable." The outgoing Federal Reserve
chairman is mostly fretting about a budget crunch that will be
provoked by Medicare and Social Security obligations. But he also has
noted that the growing trade deficit -- and the spiraling cost of
servicing it -- poses a serious threat.

A friend who is building a private equity fund for emerging
markets summed up the macro situation for me this way: "What a great
system. The Chinese lend us money to buy their goods. Then we have to
pay back the loans with interest. They make money off us on both
ends." Who are the better capitalists?

If the American economy is being hollowed out in an age of
globalization, do the traditional numbers -- jobs produced, the
unemployment rate -- have the same meaning as they did in days of
greater stability? Job creation may be up for the moment. But
long-term job security and right-now healthcare security are less
certain. Middle-class Americans can no longer expect to remain in a
well-paying job for decades, as many American workers once assumed
they would.

Consider this: GM recently announced it will be dumping 30,000
jobs and closing several plants. Shortly after that, I heard CNN
anchor Miles O'Brien gushing about a Toyota truck plant being built
in San Antonio, Texas, that will create up to 2,000 jobs paying $9 to
$11 an hour. That's about $20,000 a year -- much less than what
unionized autoworkers have made. Despite O'Brien's enthusiasm, this
is hardly a tit for GM's tat.

Sure, some job creation is better than none. But considering the
US needs to create about 160,000 jobs a month to keep even with
population growth, 215,000 is not a remarkable number. (Bush last
month claimed credit for 4.5 million new jobs created in the past
two-and-a-half years. That's just about the keep-even number of 4.8
million jobs.)

Given all the legitimate concerns an American can (and should)
have about the country's future economic well-being, the recent job
spurt is not enough to warrant cries of "Thank you, George Bush." You
don't have to be a worrywart to wonder if Bush is ignoring -- or
exacerbating -- trends that will undermine America's traditional
economic dominance. Many economists -- Morgan Stanley's Stephen Roach
and Max Sawicky, to name two -- are sounding the alarm that if
America doesn't change its borrowing ways, the nation is in for a
hard landing.

Then, there's the war. Bush depicts it as an action crucial for
the survival of the nation. Yet the nation -- or much of it -- does
not buy that, and most Americans are alienated from an endeavor that
is fundamentally redefining the country's relationship with the rest
of the globe. They are not paying for the war. Nor are they rushing
to join this grand effort.

Recruitment has become a problem for the military. And the party
that most supports the war -- the Republicans -- refuses to ask
well-heeled American citizens to finance this project, which
war-backers liken to World War II and the Cold War. In fact, the
GOPers push for more tax cuts for the wealthy, while seeking to
reduce public funds for health care for the poor, food stamps, school
lunches and other programs that benefit low-income people.

Think about it. The elites of America -- the people who enjoy the
benefits of this nation more than anyone -- are generally content to
sit back, pocket the Bush tax cuts and do nothing to encourage their
children to sign up for this noble crusade. Is there not a whiff of
end-of-empire decadence to this? But let's not blame only the
top-dwellers. This society across the board (certainly, much of the
media) pays more attention to the new Xbox 360 than daily
developments in Iraq.

One cynical TV show host recently groused to me: "Nobody cares
about the war. I don't do shows on the war. It's all about getting
through the holidays. Shopping -- that's what people care about."

A shop-till-we-drop economy and a war that is sold on the cheap.
Are these signs of increasing national greatness? Or -- bah, humbug
-- perhaps something else? Let's ask the folks at the mall.

David Corn writes The Loyal Opposition twice a month for
TomPaine.com. Corn is also the Washington editor of The Nation and is
the author of The Lies of George W. Bush: Mastering the Politics of
Deception [Crown Publishers]. Read his blog at
www.davidcorn.com.